Statement from PAC Chair on NAO report: Child Maintenance and Enforcement Commission cost reduction

It is extremely worrying that the CMEC plans for cost reduction rely so heavily on charging single parents for use of its service. CMEC intends to introduce an upfront application fee and take a slice of money collected from non-resident parents. Over a million separated families rely on this money to support their children and it is very worrying that the Department is looking to parents to pay rather than efficiency savings in the way the organization is run.

The plans to introduce fees rely heavily on introducing a new IT system. CMEC has a very poor track record of introducing IT and estimated development costs increased by 85 per cent during 2011. The report highlights that CMEC is at risk of repeating many of the mistakes made with its previous IT system.   

CMEC needs to look much closer at its own operations and find efficiencies. CMEC has improved its efficiencies since 2006, but costs remain far too high. The cost of administering a case is higher than the cost of administering one under a comparable scheme in Australia. If customers are to contribute towards the costs of CMEC, they must have confidence that the organization is run efficiently. This is not currently the case and costs are higher than necessary. Until recently old Child Support Agency management, finance and HR functions operated separately to those of CMEC. CMEC also has two head offices, one of which has been underused and the other which is expensive to run. The appointment of a new Chief Executive is positive and the organization should now get on with the job of delivering efficiency savings and better value for money.

The report is available to read on the National Audit Office website (External Website)